ADVOCAREINCOME DISCLOSURE STATEMENT 2017

AdvoCare Independent Distributors have the opportunity to purchase AdvoCare products at a discount to enjoy themselves or to resell for a profit. They also have the opportunity to earn income from building, maintaining and leading a sales organization.

WHAT SHOULD I KNOW ABOUT THE ADVOCARE BUSINESS OPPORTUNITY?

As a Distributor, you can buy products at a discount to enjoy, sell products to make a profit and sponsor others who want to
enjoy or sell the products to earn income from AdvoCare. You cannot earn money simply for sponsoring another Distributor.

Distributors set their own schedule and choose how and when to work. Many people start their business by selling products in
their spare time to people they know as a way to make a little extra money.

Building a successful business takes significant time, dedication and hard work. Like all businesses, success is not guaranteed.

All purchases come with a 30-day satisfaction guarantee and may be returned for a full refund or exchange.

Distributors are not required to purchase any products or keep any inventory. The initial cost to start is $59.00 plus tax
and shipping for the Distributor Kit. The annual renewal fee is $50.00. For those no longer interested in being a Distributor,
AdvoCare offers to repurchase all inventory, including the cost of the Distributor Kit.

HOW MUCH COULD I EARN IF I SELL ADVOCARE PRODUCTS?

As a Distributor, you will receive an immediate product discount of 20% with the ability to qualify up to 40%. The difference between the discounted price you pay and the price you charge customers can result in a 20-40% profit if you charge the suggested retail price. For example, the Distributor discount on Spark® is shown below:

SUGGESTED RETAIL PRICE:

DISTRIBUTOR PRICE (20-40% DISCOUNT):

POTENTIAL RETAIL PROFIT:

*Before shipping, taxes and expenses

$24.99

$19.99-$14.99*

$5.00-$10.00

WHAT IS THE VALUE OF THE DISCOUNT?

In 2017, AdvoCare had 387,372 Distributors who qualified for a 20 to 40% discount and purchased products or earned income from AdvoCare. While 67.28% of Distributors did not earn income from AdvoCare, they did purchase products and had the opportunity to resell them for a profit. Distributors in this group benefited from an average product savings of $294.58 (see chart). Distributors who did earn income from AdvoCare saved an average of $854.78 on their purchases.

The opportunity to earn profit from the resale of these purchases is not included in income reported by AdvoCare.

HOW MUCH CAN I EARN FROM ADVOCARE?

Distributors can earn income from AdvoCare based on the purchases and sales of people they sponsor, in addition to any in-person profits earned. The compensation (including Wholesale Commissions, Overrides, Leadership Bonuses, other bonuses, trips and incentives) set forth below reflect the gross amounts paid by AdvoCare to its Distributors for sales to their Registered Retail Customers and Preferred Customers, as well as for the activities of the Distributors’ sales organizations. In total, 32.72% of Distributors received compensation from AdvoCare (Paid Distributors). The median annual compensation paid by AdvoCare to Paid Distributors in 2017 was $125 ($1,402 average).

PERCENTILEOF PAIDDISTRIBUTORS

NUMBEROF PAIDDISTRIBUTORS

MINIMUMINCOMEEARNED

AVERAGETIME ASDISTRIBUTORS

TOP 50%

63,368

$125

3.6 YEARS

TOP 10%

12,673

$944

4.2 YEARS

TOP 1%

1,267

$17,826

7.9 YEARS

2017 INCOME

NUMBER OFDISTRIBUTORS

PERCENTAGE OFDISTRIBUTORS

$0

260,635

67.28%

$0.01 - $200

77,707

20.06%

$201 - $500

26,303

6.79%

$501 - $2,000

16,153

4.17%

$2,001 - $10,000

4,676

1.21%

$10,001 - $20,000

735

0.19%

$20,001 - $50,000

618

0.16%

$50,001 - $150,000

370

0.10%

$150,001 - $300,000

105

0.03%

$300,001 - $4M

70

0.02%

*In 2017, AdvoCare had 387,372 Distributors who purchased products at a discount and/or earned income from AdvoCare.

These income amounts do not include expenses the Distributor may have incurred, nor any profits earned from in-person retail sales. For more information about how to earn income, review the AdvoCare Policies, Procedures & Compensation Plan.

WHAT IF IT DOESN’T WORK FOR ME?

AdvoCare offers to repurchase all inventory from Distributors who choose to resign or otherwise discontinue their Distributorship, including the cost of the Distributor Kit. Contact Customer Service at 1-800-542-4800 and review the AdvoCare Policies, Procedures & Compensation Plan for more information.